Wp/8523/2023 Of Deepak Rakhamaji Hadavale v. Income Tax Officer, Ward - 28-1-1

1 903-wp-8523-2023 Digitallysigned byASHVINIASHVINIBAPPASAHEBBAPPASAHEBKAKDEKAKDEDate:2023.07.1717:10:16+0530 IN THE HIGH COURT OF JUDICATURE AT BOMBAYCIVIL APPELLATE JURISDICTION WRIT PETITION NO.8523 OF 2023 Deepak Rakhamaji Hadavale … Petitioner V/s. Income Tax Officer, Ward-28(1)(1)& Ors. … Respondents ----- Mr. Dharan Gandhi for Petitioner.Mr.Manoj Shirsat, Sr. Panel Counsel for Respondents. ----- CORAM :K. R. SHRIRAM &FIRDOSH P. POONIWALLA, JJ.DATE :11[th] JULY 2023 P. C.:- 1.With the consent of Counsels we have taken this Petition to bedisposed at the admission stage itself. 2.Petitioner is aggrieved by an order dated 31[st] March 2023, passed under Section 148A(d) of the Income Tax Act, 1961(“the said Act”), which was passed following a notice dated 18[th] February 2023 that wasissued under Section 148A(b) of the said Act. 3.Petitioner is an individual resident of India and an Assesseeunder the said Act. During the Financial Year 2015-16 relevant to Assessment Year (AY) 2016-17, on 16[th] July 2015 Petitioner had transferred a propertybeing Flat No.104, First Floor, Divyal Co-operative Housing Society Limited, Plot No.D 62/63, C-9, Airoli, Navi Mumbai, 400 708 for Rs.46,50,000/-. It isPetitioner’s case that there was no other property that was transferred byPetitioner.Sometime in February 2023 Petitioner received from RespondentNo.1 a notice dated 18[th] February 2023 under Section 148A(b) of the saidAct. It is stated in the notice that as per the AIR-007(information) Petitionerhas sold two immovable properties valued at Rs.30,00,000/- or more for atotal consideration of Rs.93,00,000/-. The source of information was Sub-registrar Office-3, Thane. 5.Petitioner replied vide letter dated 2[nd] March 2023 and informedRespondent No.1 that during the year under consideration Petitioner hadsold only one property valued at Rs.46,50,000/-. Petitioner also stated thatperhaps the transaction is reported twice or may not belong to Petitioner.Despite this, Petitioner received an order dated 31[st] March 2023, passed byRespondent No.1 under Section 148A(d) of the said Act, where RespondentNo.1 has incorrectly recorded that Petitioner has admitted that he has carriedout that two transactions as mentioned in the notice. Paragraph 4 of the saidorder reads as under:- “The notice u/s. 148(b) of the Act dated 18.02.2023 was dulyserved upon the assessee through e-proceedings module of e-filing portal, speed-post & email. In response to the Notice, the assessee submitted the details and owned up the reportedtransaction carried out during the relevant financial year whichwas provided to the assessee with the above mentioned showcause notice.”(emphasis supplied) 6.In the said order it is also incorrectly mentioned that Petitionerfailed to submit any documentary evidence for double reporting of sale ofproperty and details of cost of acquisition. Therefore, the entire saleconsideration of Rs.93,00,000/- will be treated as capital gain and this willbe the escaped income in the year under consideration. 7.We fail to understand how a person can prove the negative. Theonus was on the Assessing Officer to prove that what the Petitioner hasstated in the Reply was incorrect and in fact there were two transactionslinked to Petitioner as against Petitioner’s stand that there was only onetransaction during the relevant Assessment Year. 8.Moreover, how can the entire sale consideration be treated ascapital gain. There must have been some cost price which after applying therequired formula has to be reduced from the sale consideration to determinecapital gain. In the circumstances, though Mr. Shirsat had requested for sometime to take instructions and file reply, we see no reason to grant any time. 7.We fail to understand how a person can prove the negative. Theonus was on the Assessing Officer to prove that what the Petitioner hasstated in the Reply was incorrect and in fact there were two transactionslinked to Petitioner as against Petitioner’s stand that there was only onetransaction during the relevant Assessment Year. 8.Moreover, how can the entire sale consideration be treated ascapital gain. There must have been some cost price which after applying therequired formula has to be reduced from the sale consideration to determinecapital gain. In the circumstances, though Mr. Shirsat had requested for sometime to take instructions and file reply, we see no reason to grant any time. 9.In the circumstances, we quash and set aside the order dated31[st] March 2023 passed under Section 148A(d) of the said Act. Consequentlysubsequent notice also dated 31[st] March 2023 issued under Section 148 isalso quashed and set aside. 10.The matter is remanded to the concerned officer to pass acorrect order in accordance with law after correctly considering the Replyfiled by Petitioner on 2[nd] March 2023 and also affording a personal hearingto Petitioner. Notice of personal hearing shall be communicated at leastseven working days in advance. 11.Petition disposed. 12.All the rights and contentions are kept open includingPetitioner’s contention that amount involved is less than Rs.50,00,000/- andtherefore, it cannot be re-opened. 13.Of course it is also open to the Respondent No.1 to makeinquiries and find evidence to justify, what is stated in the annexures to theoriginal notice issued under Section 148A(b). (FIRDOSH P. POONIWALLA., J.) (K. R. SHRIRAM, J.)